The Canadian economy could be in for a second recession, according to a Moody’s Analytics report. The culprits: record high levels of Canadian household debt, and little room for stimulus should the cost of borrowing go up.
The Bank of Canada has maintained its overnight lending rate at 1 per cent – for the 16th consecutive time. What does this mean for borrowers and investors alike – and will the rate rise any time soon?
Looks like the Bank of Canada has been a tad too optimistic about the government’s willingness to spend – and that recent belt-tightening measures will amount to a 0.2 per cent drag on our country’s GDP growth.
Bank of Canada Governor Mark Carney has repeatedly warned Canadians to simmer down on their borrowing costs – but that hasn’t stopped us from racking up a new 8-year record high debt level. According to credit bureau TransUnion, average Canadian debt levels (excluding mortgages) reached $26,221 in the second quarter – an increase of $192.
Canada continues to be affected by a dampened outlook on the global economy as the Bank of Canada announced today that it would hold its rate due to lower-than expected economic growth since its April report.